Grain experts conference hints Soviets feel the pinch

June 13, 1980

By David FouquetSpecial to The Christian Science Monitor

Brussels

The length of the line of persons queuing up for meat and other necessities in the Soviet Union cast a long shadow over a meeting of reprsentatives of the world's major grain-exporting nations here recently.

One of the main concerns at the gathering of experts from the US, the European Common Market, Canada, Australia, and Argentina was the impact of the six-month-old US proposal for a grain-export embargo to the Soviet Union in response to the Soviet military intervention in Afghanistan.

In addition to consequences for the Soviet food supply, another major consideration was the continuing cost of this "food weapon" to the producers and their farmers. This review came amid continuing reports of noncompliance with the embargo and a good Soviet harvest that could break the back of the US policy.

The meeting, for two days here and two additional days in the French city of Reims, was a highly confidential one held to review the operation of the world grain situation in the wake of the grain embargo, and to consider an extension.

The US delegation was headed by Dale Hathaway, undersecretary of agriculture for international affairs, and Thomas Saylor of the Foreign Agriculture Service of the Department of Agriculture.

Sources close to the meeting say the US asked the other countries to refrain from undercutting the partial US embargo on shipments to the Soviet Union. They also indicated that the meeting seemed to signal no change in the other countries' positions. Argentina in the past has refused to restrict its sales to Moscow, while the Europeans, Canadians, and Australians have said they would not substitute their products beyond "traditional levels" for embargoed US supplies.

The question of future deliveries is also said to require rapid decisions in countries like Canada and Australia, which have government marketing boards controlling their grain exports. However, European sources indicate there was some suspicion amid European circles of the possibility that the US was asking the other producers to maintain restrictions on shipments to the Soviet Union while actually stepping up American exports.

American sources before and after the meeting expressed satisfaction with the effects of the US ban on 18 million tons of grain to the Soviet Union. And they discounted published reports that the plan was plagued by smuggling by US and other suppliers, had disrupted the world grain market and rather than affecting the Soviet Union, or had backfired into a major expense for the US government and farmer.

Rather than aiming at triggering mass hunger or food shortages in the Soviet Union as the price for the Afghan adventure, US sources say the goal was a gradual pinch and perhaps a reordering of Soviet economic and military priorities. They claim the impact is being felt where it might hurt the most -- in the consumer-goods-starved Soviet public. "The length of time spent in line for goods is improtant in the Soviet Union," one source said. "It's a test of whether the system is working."

He added that the holding back of US grain destined for Soviet animal feed had resulted in bottlenecks in deliveries, cutbacks in milk and butter, and a "quite heavy" drawing down of the livestock herds in the Soviet Union that were intended to supply meat to the public. While no one knows exactly what the Soviet grain harvest and need will be in the coming season, he added, indications were that the country continue to require significant imports of grain to fill its needs.

The aim of US policy and the meeting was to persuade the other grain-exporting nations to refuse to fill at least some of this Soviet demand without harming their own interest or the world market. These US sources said they even understood the decision of Argentina not to go along with the boycott, because grain exports were so important that they accounted for 80 percent of the country's foreign exchange.

An important factor in the impact of the embargo policy will be the result of the grain harvests in the Soviet Union and around the world. Alfred C. Toepfer International of Hamburg, Europe's main grain dealer, recently forecast that the outlook for grain harvests for Europe and the Soviet Union was considerably better than last year, when the Soviet Union experienced a disastrous crop yer of 197 million tons, leaving a shortfall of 35 millions tons. It was this need that the 18 million additional US tons, which were embargoed, were supposed to fill.

It added that a harvest of 200 million to 220 million tons would seem realistic to meet anticipated needs of some 225 million to 230 million tons. This shortfall would be easily filled on the world market, the firm said.

Nevertheless, the US sources maintained that there would be a high a need for Soviet imports and the embargo was beginning to bite into the system. They also rejected frequent reports that sales through intermediaries had undermined their embargo policy. They said the exporting countries' shipments had been anticipated and information about deliveries was exchanged and monitored closely.

"Trade patterns are pretty well plotted. It's not all that complicated to follow 10 or 20 ships a week on the high seas that carry grain cargo," one said.

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